Feb 1 The IKEA Foundation: Changing the Face of Philanthropy?

“Aid organisations need, in many ways, to think like companies: corporates have to innovate constantly or else they die,” Per Heggenes (CEO of the IKEA Foundation) explains. “The structure in the development world is different, but that doesn’t mean they can’t drive efficiency and increase the quality of what they do.”

This quote and the picture above are from a terrific article on the IKEA Foundation featured in Philanthropy Age last week. This piece highlights the organization's passion for innovation, risk-taking and holistic approaches that put people first, and aim to achieve long-term impact. How many foundations do we know of today that have had the courage and determination to address extremely challenging and pervasive issues such as refugee situations worldwide, or take on the global water crisis with a completely different approach that focuses more on system change (e.g. WaterCredit) than traditional programs that solely hone in on building more wells?

Partnering with UNHCR (the UN's Refugee Agency), the IKEA Foundation has invested more than $60 million in a very comprehensive and promising program in Ethiopia, helping create a better life for Somalian refugees. Since most refugees end up living in these camps for more than 10 years, the foundation and UNHCR focused on a critical component to improve living standards and dignity - housing. As Per Heggenes notes, “can you imagine the hardship of living in a tent for some 17 years?” Linked to a social enterprise model, the IKEA Foundation and UNHCR developed a better shelter for refugees. "The prototype shelter is classic IKEA. It combines the company’s business savvy, the foundation’s financial and collaborative clout, and its partners’ on-the-ground experience."

One of my favorite quotes from this article: “The best comment came from a man in Iraq. ‘The tent was not home; I would not have welcomed you in a tent. I am able to welcome you in my shelter’,” recalls Olivier Delarue of UNHCR Innovation, which aided in the shelter’s development."

I have been a fan of the IKEA Foundation for many years. Most recently, I've had the opportunity to work with this incredible team, including Vandana Verma and Per Heggenes, through my role at Water.org. The IKEA Foundation currently supports Water.org's WaterCredit programs in Bangladesh and our innovation fund (Water.org's New Ventures Fund).

As someone who is passionate about strategic partnerships, it's very inspiring to see a growing foundation flip the way we traditionally view philanthropy upside down and think out of the box to identify ways in which we can improve results on the ground. Many non-profits have been advocating for this shift in philanthropy. While it can be challenging to shake up how foundations are able to roll out their philanthropic giving and pursue more innovative approaches, the IKEA Foundation has taken this head-on. The foundation understands that risk-taking and failing are critical for success:

"Heggenes is matter-of-fact about the risks the foundation has taken to get this far – he sees it simply as their duty. “We were willing to go into a multi-year process of trying to develop something that might not have come to anything,” he says. “It requires a combination of long-term investment and being ready to make mistakes. But we can only do this if we have good relationships to collaborate with different organisations. That is what makes it a success.”

Furthermore, you'll see how the IKEA Foundation's efforts complement how IKEA as a company is thinking about mitigating the impact of its operations on communities worldwide. "If IKEA’s ethos is making the best products for people, then its social responsibility efforts and the foundation are natural extensions of the business. An important part of IKEA strategy is to make sure they minimise the impact they have on the communities in which they operate,” explains Heggenes. “What we do through the foundation is, on a larger scale, develop programmes that will permanently help create a better standard of living for people who are part of those communities.”